Murray Goulburn’s takes further drastic measures
Murray Goulburn dairy co-operative will be shutting three plants and wiping framer’s debts in an effort to turn its business around.
In an update to the Australian Securities Exchange (ASX), Murray Goulburn (MG) said it will be closing its Edith Creek, Rochester and Kiewa processing facilities by the first quarter of its 2019 financial year.
Closures at Rochester and Kiewa will commence August 2017 and a total of 360 jobs will be lost across all three plants.
MG said the closures will cost AUD $60 million, but will save the company $40 – $50 million annually once they take place.
Farmer debts forgiven
MG also announced that it would forgive all milk supply support package debts.
The loan package was given to its farmers in 2016 after MG lowered the price it was expected to pay farmers for their milk.
Wiping the debts will cost MG AUD $148 million, with the company giving back any repayments already made by farmers. This will be the case whether the farmer is still a MG supplier or not.
MG said it remains committed to paying its farmers $4.95 per kilogram of milk solids for the 2017 financial year.
Dairy Beverages and Nutritionals business scrapped
Following a review, MG has decided to scrap its Dairy Beverages and Nutritionals business, deciding to write-down the $62 million already invested in the project.
“These have been difficult decisions to make”
Reflecting on the announced actions, MG Chief Executive Officer, Ari Mervis, said they were important for the business.
“These have been difficult decisions to make, however they are necessary steps on the journey to ensure the future strength and competitiveness of Murray Goulburn,” Mervis said.
“A strong MG is of fundamental importance to the Australian dairy industry and these decisions are necessary to lay the foundation for the future,” he stated.
- ACCC proceedings against Murray Goulburn and former management
- Murray Goulburn, what went wrong?
- Dairy farmers angry at milk price cuts
- Big losses announced byMurray Goulburn
- Ari Mervis appointed asMurray Goulburn CEO
- Murray Goulburntakes home $40 million net profit despite farmer crisis
- ACCC to host farmer forums forDairy Inquiry
- Australiandairy industry agrees on voluntary code of conduct
- Katter Party pushing for ‘fair milk’ logo
The Australian Federal Court has ordered Woolworths to pay $9 million in penalties for its role in a...
A new study out of the University of Sydney has discovered why artificial sweeteners can make both h...
Woolworths reopened its Warringah Mall store on 10 November 2016, in a first-time display of its new...
Australians could one day be eating allergy-free nuts and edible packaging according to the CSIRO wh...
A United States company has launched a new sweetener made from sweet potato, pitching it as a “clean...
Coca-Cola is launching a new juice brand in Australia targeting working adults who are focused on th...
An Allen’s Lollies store has been opened in Melbourne to provide gifts for the 2017 festive season.
The welfare standards maintained whilst producing some of Australia’s most popular Christmas hams ha...